KLA Corporation (KLAC) Q1 Earnings: What To Expect

Jabin Bastian /
2022/04/27 8:28 am EDT

Maker of equipment for semiconductor manufacturing, KLA Corporation (NASDAQ:KLAC) will be announcing earnings results tomorrow after market hours. Here's what to look for.

Last quarter KLA Corporation reported revenues of $2.35 billion, up 42.5% year on year, in line with analyst expectations. It was a mixed quarter for the company, with an exceptional revenue growth but an underwhelming revenue guidance for the next quarter.

Is KLA Corporation buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting KLA Corporation's revenue to grow 22.1% year on year to $2.2 billion, slowing down from the 26.6% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $4.82 per share.

KLA Corporation Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 2.4%.

Looking at KLA Corporation's peers in the semiconductors segment, some of them have already reported Q1 earnings results, giving us a hint of what we can expect. Lam Research delivered top-line growth of 5.52% year on year, missing analyst estimates by 4.33%. The stock traded down 3.68% on the results. Read our full analysis of Lam Research's results here.

There has been a stampede out of high valuation technology stocks and semiconductors stocks have not been spared, with share price down on average 15.5% over the last month. KLA Corporation is down 14.3% during the same time, and is heading into the earnings with analyst price target of $440.0, compared to share price of $317.1.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.